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The next big buy in junk bonds: the US consumer

Pimco, Prudential and others betting on American companies driven by retail customers. By Emma Orr

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HIGHER CONSUMER CONFIDENCE: Shoppers in a Home Depot store. The Bank of America Merrill Lynch high-yield index of US consumer product companies has risen 2.81% since the Brexit vote in June on a total return basis, compared with a 2.4% gain for junk bonds overall.

New York

SOME of the world's largest junk-bond investors are betting big on the US consumer.

Money managers including Pacific Investment Management Co (Pimco) and Prudential Financial Inc's PGIM are buying high-yield bonds tied to home builders, lumber, lodging, air travel and